Investments are Destiny
Acquisitions in large organizations usually begin with creating a team of stakeholders and then an RFP that eventually leads to a selection process that relies on a Kepner Tregoe Analysis (KTA) of vendor brochures, briefings, and subjective measures of ease-of-use and risks. It is a cumbersome process that often distorts product stack rankings by inflating the value of unneeded features, functions, and capabilities and incumbent vendor relations. The result is a selection process that favors risk minimization and the status quo over operational improvements or budget constraints, not always a good thing in a rapidly evolving market.
A better approach is developing an RFP that treats traditional measures of product attractiveness as “go/no go” filters and focuses instead on ease-of-use, ecosystem support, post-sales support effectiveness, vendor migration services and guarantees, product quality and product age considerations, and financial considerations. This streamlines the KTA and better aligns with CIO priorities and vendor R&D investments. Even users satisfied with their incumbent vendors should consider revising their RFPs and invite non-incumbent vendors to bid for their business to ensure that they are not missing innovative solutions or being taken for granted by their sales team.
Streamlining RFPs also makes it easier to revisit past decisions that are causing application and data mobility problems, hindering digital business initiatives, consuming too much support, or impeding the use of hybrid-cloud infrastructures. The insights and recommendations listed below are designed to help users overcome institutional inertia, simplify the recrafting of RFPs, and improve acquisition outcomes by highlighting the importance of considerations that only become visible after systems are put into production.
Overcome Institutional Inertia
Skills shortages and risk adverse behavior make minimizing change the default goal of many RFPs until users become unhappy with their incumbent vendor solutions. That unhappiness can arise from product problems, poor post-sales support, being overcharged, or architectural obsolescence. Fortunately, vendor lock-ins are weakening for a variety of reasons including.
- Virtualization and containers (i.e., Kubernetes) increase application and data mobility and are making self orchestration practical.
- Vendors fighting for market share are increasingly willing to take ownership of data migrations to bound migration risks and staff resource demands.
- Users now have access to a plethora of migration tools that reduce the skills and resources needed to change architectures and vendors.
- Emerging companies that have innovative solutions and compete on price and post-sales support are gaining share against established portfolio companies.
Use Analysts and Product Reviews to Save TimeCreating Vendor Shortlists
Users can save enormous amounts of time doing marketresearch and evaluating vendor RFP responses by using analysts/advisors that work with vendors and users to develop a shortlist of vendors offering competitive or innovative solutions. A non-exhaustive list of analyst firms that rate vendors in published research could include Gartner, IDC, Evaluator Group, ESG, and Gigaom.
Since analysts and peers have more credibility and influence with decision makers than they do, many vendors will provide their prospects with access to reports such as Gartner Magic Quadrant and Peer Insights at no cost.
Treat Traditional Measures of Storage Systems as“Go/No-go” Filters
KTA analysis embeds the adage that more is better into the acquisition process despite that fact that more is often accompanied by more cost and complexity which increases risk. Capping the usefulness of more capacity, performance, functionality, and other measures of product attractiveness against forecasted growth rates over systems’ planned service lives makes them go/no-go filters instead of KTA variables. This focuses KTA analyses on the subtle considerations that reduce risks, create competitive advantage or lower costs which over time becomes a competitive advantage. For example, system A and system B both meet worst-case performance forecasts over the system’s planned 5-year service life. System A has twice the performance and capacity of system B but costs 50% more and has a larger footprint than system B. If there is confidence in the forecasts, using the go/no-go approach focuses the decision not on performance but post-sales support, and financial considerations that should include upgrade and maintenance costs. This approach also has the advantage of improving communication between dev/ops and operations, coaxing out hidden agendas, and providing negotiation leverage with vendors offering more.
Quantify the value of Vendor Guarantees
Every vendor claims that they are best in whatever metrics are important in the selection decision and will often use guarantees to buttress their claims, but unless the remedies included keep the user whole, they should be treated as marketing programs. However, guarantees that do include meaningful remedies can be very valuable because they bound risks. For example, taking ownership of data migrations and agreeing to pay excess maintenance costs and software license fees should schedules slip reduce the risks of changing vendors. With skills shortages rampant and vendors emphasizing the value of their AI and integrations with other vendors offerings, users should not be shy about asking for productivity guarantees that include meaningful remedies.
Even“no’s” provide insights into the vendor’s understanding of the market and their products’’ real capabilities.
Tie-Breaker Considerations
Users that maintain a competitive acquisition environment must often choose between solutions with similar capabilities and prices from vendors offering excellent customer support. Users that want more rigor than a coin toss can use the following tie-breaker considerations to optimize their acquisition decisions.
Product development risks
- When did the system first ship? Buying a new system that has not yet been market validated is risker than buying a system that has been market validated. Buying a solution approaching the end of its marketing life decreases the probability of it receiving significant new enhancements.
* How many microcode updates have been shipped since FCS (First Customer Shipment)?
* How many were fixes, functional enhancements, consolidation releases? Functional enhancements
are great. Lots of fixes not so much because they suggest schedule pressure on development and cursory QA. - When did its predecessor first ship? This helps to determine the probable service life of the system being bid.
- Operational risks
* How large is the install base?
* How many systems have crashed or lost data?
* How many systems have been replaced?
* What is the first call resolution rate?
* Does maintenance include named rep support? - If applicable: differences in consumption and software license pricing models?
Among the more visible are HP’s GreenLake. IBM’s Flexible Consumption, NetApp’s
Keystone, and Pure Storage’s Pure as-a-Service
Bottom Line
Take a top-down approach and use analysts/advisors to help develop capabilities-oriented RFPs to improve acquisition effectiveness, improve agility, and reduce the risks of technical deficits arising. Validate vendor insights into their competitors’ shortcomings with your analysts before taking them into account in the acquisition process. Allow shortlisted vendors insight into your operations but control the flow of acquisition-oriented information to them to maintain negotiation leverage.
— Stanley Zaffos | independent consultant | stnlyzffs@gmail.com
Advisor, Lionfish Tech Advisors Inc. | Lion Briefs Contributor
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© 2022 Stanley Zaffos